A man takes a car loan of ₹6,00,000 at an interest rate of 12% per annum from a bank for 2 years. The EMI under flat rate system is:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → ₹31,000
$P = 600000,\ r = 12\%,\ t = 2\ \text{years}$
$\text{Flat interest} = P \cdot r \cdot t = 600000 \cdot \frac{12}{100} \cdot 2 = 144000$
$\text{Total amount} = 600000 + 144000 = 744000$
$\text{Number of months} = 24$
$\text{EMI} = \frac{744000}{24} = 31000$
$\text{EMI} = ₹31,000$